<PAGE> 1
Filed Pursuant to Rule 424(B)(2)
Registration No. 033-37598
PROSPECTUS SUPPLEMENT
(To Prospectus dated October 16, 1995)
NORWEST FINANCIAL, INC.
$150,000,000
6% SENIOR NOTES 1999 SERIES DUE AUGUST 1, 1999
LOGO
Interest on the Notes is payable semi-annually on February 1 and August 1 of
each year, beginning February 1, 1998. The Notes are not subject to redemption
prior to maturity.
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THESE SECURITIES HAVE NOT BEEN APPROVED OR DISAPPROVED BY THE SECURITIES AND
EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION NOR HAS THE SECURITIES
AND EXCHANGE COMMISSION OR ANY STATE SECURITIES COMMISSION PASSED UPON THE
ACCURACY OR ADEQUACY OF THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS. ANY
REPRESENTATION TO THE CONTRARY IS A CRIMINAL OFFENSE.
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The Notes will be sold to the public at varying prices to be determined by the
Underwriters at the time of each sale. The net proceeds to the Company, before
deducting expenses payable by the Company (estimated to be $50,000), will be
99.918% of the principal amount of the Notes sold and the aggregate net proceeds
will be $149,877,000 plus accrued interest, if any, from August 1, 1997. For
further information with respect to the plan of distribution and any discounts,
commissions or profits on resales of Notes that may be deemed underwriting
discounts or commissions, see "Underwriting."
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The Notes are offered by the Underwriters, subject to prior sale, when, as and
if issued to and accepted by the Underwriters, subject to approval of certain
legal matters by counsel for the Underwriters and certain other conditions. The
Underwriters reserve the right to withdraw, cancel or modify such offer and to
reject orders in whole or in part. It is expected that delivery of the Notes
will be made in New York, New York on or about August 1, 1997 against payment
therefor in immediately available funds.
CHASE SECURITIES INC.
BEAR, STEARNS & CO. INC.
PAINEWEBBER INCORPORATED
The date of this Prospectus Supplement is July 25, 1997
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CERTAIN PERSONS PARTICIPATING IN THE OFFERING MAY ENGAGE IN TRANSACTIONS
THAT STABILIZE, MAINTAIN OR OTHERWISE AFFECT THE PRICE OF THE NOTES, INCLUDING
OVERALLOTMENT, STABILIZING TRANSACTIONS AND SYNDICATE SHORT COVERING
TRANSACTIONS. FOR A DESCRIPTION OF THESE ACTIVITIES, SEE "UNDERWRITING."
RECENT DEVELOPMENT
On June 23, 1997, Norwest Corporation ("Norwest") entered into an agreement
with BankBoston Corporation ("BankBoston") pursuant to which it agreed to
purchase Fidelity Acceptance Corporation ("Fidelity"), a BankBoston subsidiary
engaged in the business of sub-prime auto finance. Norwest Financial, Inc. (the
"Company") is an indirect wholly-owned subsidiary of Norwest. It is contemplated
that the Company will acquire Fidelity, directly or through Norwest.
The principal business of Fidelity is making direct loans secured by
automobiles and purchasing sales finance contracts directly from automobile
dealers. As of May 31, 1997, Fidelity and its subsidiaries operated 150 branch
offices in 31 states and Guam and had approximately $1.12 billion of net finance
receivables outstanding.
It is estimated that the purchase price to be paid for Fidelity will be
$339 million. In addition, intercompany borrowings of approximately $744 million
will be repaid to BankBoston or its affiliates at closing. The purchase will be
financed through the incurrence of indebtedness (including the Notes) by the
Company, internally generated funds and additional equity funds provided by
Norwest, the respective amounts of which have not yet been determined.
RATIOS OF EARNINGS TO FIXED CHARGES
The following table sets forth the ratios of earnings to fixed charges of
the Company and its subsidiaries for the periods indicated:
<TABLE>
<CAPTION>
THREE MONTHS
ENDED
MARCH 31, 1997
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YEAR ENDED DECEMBER 31,
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1992 1993 1994 1995 1996
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<S> <C> <C> <C> <C> <C>
2.02 2.22 2.26 2.13 2.11 2.01
</TABLE>
The ratios of earnings to fixed charges have been computed by dividing net
earnings plus fixed charges and income taxes by fixed charges. Fixed charges
consist of interest and debt expense plus one-third of rentals (which is deemed
representative of the interest factor).
INTERIM FINANCIAL RESULTS AND SELECTED FINANCIAL DATA
On July 14, 1997, the Company announced total income of $767,893,000 and
net earnings of $131,086,000 for the six months ended June 30, 1997. These
results represent a 2% increase over total income and a 2% increase over net
earnings for the six months ended June 30, 1996. In the Company's Quarterly
Report on Form 10-Q for the fiscal quarter ended March 31, 1997, the Company
reported total assets of $7,656,215,000, total liabilities of $6,545,331,000 and
total stockholder's equity of $1,110,884,000.
S-2
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DESCRIPTION OF THE NOTES
The following description of the particular terms of the Notes hereby
supplements the description of the general terms and provisions of the Debt
Securities set forth in the Prospectus, to which description reference is hereby
made.
GENERAL
The Notes will be issued under an Indenture dated as of May 1, 1986, as
amended and supplemented by a first supplemental indenture dated as of February
15, 1991, between the Company and The Chase Manhattan Bank, as Trustee (the
"Trustee") as successor by way of merger to The Chase Manhattan Bank (National
Association), will be limited to $150,000,000 aggregate principal amount and
will mature on August 1, 1999. The Notes will bear interest from August 1, 1997
at the annual rate set forth on the cover page of this Prospectus Supplement,
payable each February 1 and August 1, commencing February 1, 1998. Interest will
be payable generally to the person in whose name the Note is registered at the
close of business on the January 15 or July 15 record date next preceding the
February 1 or August 1 interest payment date. Payment of interest and principal
at maturity will be made by check mailed to the persons entitled thereto;
provided, however, that any such payment will be made by wire transfer of
immediately available funds to any registered holder of Notes having an
aggregate principal amount in excess of $1 million if appropriate wire transfer
instructions shall have been provided by such holder to the Trustee no less than
five business days prior to (i) the record date for the applicable interest
payment date or (ii) the maturity date for payments of principal. Payment of
principal at maturity will be made upon surrender of a Note.
REDEMPTION
The Notes may not be redeemed prior to maturity.
CONCERNING THE TRUSTEE
The Trustee has extended a line of credit to the Company. The Company
borrows money and has other customary banking relationships with the Trustee in
the ordinary course of business.
S-3
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UNDERWRITING
Subject to the terms and conditions set forth in an underwriting agreement
(the "Underwriting Agreement") among the Company and Chase Securities Inc.,
Bear, Stearns & Co. Inc. and PaineWebber Incorporated (the "Underwriters"), the
Company has agreed to sell to the Underwriters, and the Underwriters have
severally agreed to purchase, the respective principal amounts of the Notes set
forth after their names below. The Underwriting Agreement provides that the
obligations of the Underwriters are subject to certain conditions precedent and
that the Underwriters will be obligated to purchase all of the Notes if any are
purchased.
<TABLE>
<CAPTION>
UNDERWRITER PRINCIPAL AMOUNT
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<S> <C>
Chase Securities Inc. ............................................... $100,000,000
Bear, Stearns & Co. Inc. ............................................ 25,000,000
PaineWebber Incorporated............................................. 25,000,000
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Total................................................... $150,000,000
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</TABLE>
The Underwriters have advised the Company that they propose to offer the
Notes for sale from time to time in one or more transactions (which may include
block transactions), in negotiated transactions or otherwise, or a combination
of such methods of sale, at market prices prevailing at the time of sale, at
prices related to such prevailing market prices or at negotiated prices. The
Underwriters may effect such transactions by selling the Notes to or through
dealers, and such dealers may receive compensation in the form of underwriting
discounts, concessions or commissions from the Underwriters and/or the
purchasers of the Notes for whom they may act as agent. The Underwriters and any
dealers that participate with the Underwriters in the distribution of the Notes
may be deemed to be underwriters, and any discounts or commissions received by
them and any profit on the resale of the Notes by them may be deemed to be
underwriting discounts or commissions.
The Notes are a new series of securities with no established trading market
and will not be listed on any securities exchange. The Underwriters have advised
the Company that they intend to make a market in the Notes, but are under no
obligation to do so and such market making may be terminated at any time.
Therefore, no assurance can be given as to the liquidity of, or the trading
market for, the Notes.
The Trustee is an affiliate of Chase Securities Inc. and engages in general
financing and banking transactions with the Company and its affiliates.
The Underwriting Agreement provides that the Company will indemnify the
Underwriters against certain civil liabilities, including liabilities under the
Securities Act of 1933, as amended, or contribute to payments the Underwriters
may be required to make in respect thereof.
In connection with the offering of the Notes, Chase Securities Inc., on
behalf of the Underwriters, may engage in overallotment, stabilizing
transactions and syndicate covering transactions in accordance with Regulation M
under the Securities Exchange Act of 1934, as amended. Overallotment involves
sales in excess of the offering size, which creates a short position for the
Underwriters. Stabilizing transactions involve bids to purchase the Notes in the
open market for the purpose of pegging, fixing or maintaining the price of the
Notes. Syndicate covering transactions involve purchases of the Notes in the
open market after the distribution has been completed in order to cover short
positions. Such stabilizing transactions and syndicate covering transactions may
cause the price of the Notes to be higher than it would otherwise be in the
absence of such transactions. Such activities, if commenced, may be discontinued
at any time.
S-4
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NO DEALER, SALESPERSON OR OTHER INDIVIDUAL HAS BEEN AUTHORIZED TO GIVE ANY
INFORMATION OR TO MAKE ANY REPRESENTATIONS OTHER THAN THOSE CONTAINED OR
INCORPORATED BY REFERENCE IN THIS PROSPECTUS SUPPLEMENT OR THE PROSPECTUS IN
CONNECTION WITH THE OFFER MADE BY THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS
AND, IF GIVEN OR MADE, SUCH INFORMATION OR REPRESENTATIONS MUST NOT BE RELIED
UPON AS HAVING BEEN AUTHORIZED BY THE COMPANY OR THE UNDERWRITERS. THIS
PROSPECTUS SUPPLEMENT AND THE PROSPECTUS DO NOT CONSTITUTE AN OFFER TO SELL OR
THE SOLICITATION OF AN OFFER TO BUY ANY SECURITY TO ANY PERSON IN ANY
JURISDICTION IN WHICH SUCH OFFER OR SOLICITATION IS NOT AUTHORIZED OR IN WHICH
THE PERSON MAKING SUCH OFFER OR SOLICITATION IS NOT QUALIFIED TO DO SO OR TO
ANYONE TO WHOM IT IS UNLAWFUL TO MAKE SUCH OFFER OR SOLICITATION. NEITHER THE
DELIVERY OF THIS PROSPECTUS SUPPLEMENT AND THE PROSPECTUS NOR ANY SALE MADE
HEREUNDER AND THEREUNDER SHALL UNDER ANY CIRCUMSTANCE CREATE AN IMPLICATION THAT
THERE HAS BEEN NO CHANGE IN THE AFFAIRS OF THE COMPANY SINCE THE DATE HEREOF.
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TABLE OF CONTENTS
<TABLE>
<S> <C>
PROSPECTUS SUPPLEMENT
Recent Development..................... S-2
Ratios of Earnings to Fixed Charges.... S-2
Interim Financial Results and Selected
Financial Data....................... S-2
Description of the Notes............... S-3
Underwriting........................... S-4
PROSPECTUS
Available Information.................. 2
Incorporation of Documents by
Reference............................ 2
The Company............................ 3
Ratios of Earnings to Fixed Charges.... 3
Use of Proceeds........................ 3
Description of Debt Securities......... 4
Plan of Distribution................... 7
Legal Opinions......................... 8
Experts................................ 8
</TABLE>
Prospectus Supplement
NORWEST FINANCIAL, INC.
$150,000,000
6% SENIOR NOTES 1999 SERIES
DUE AUGUST 1, 1999
LOGO
CHASE SECURITIES INC.
BEAR, STEARNS & CO. INC.
PAINEWEBBER INCORPORATED
DATED JULY 25, 1997
